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Data Science for beginners: a practical example to understand it better

Big, data, data mining, artificial intelligence? Do not panic.

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Data Science for beginners: a practical example to understand it better

When we talk about science data, data mining and artificial intelligence only we assimilate which is one of the technologies that are changing our lives without seeing in practice how this happens. It is quite complex to find information on the application of this technology to our day to day.

Nowadays, not using all the technological advantages that exist is going a step back in a highly competitive world, a world that is constantly advancing and, above all, that most processes are moving from outdated systems, obsolete to the efficiency and speed that you offer the most innovative tools of our times.

These days, data science is used in different industries. In marketing, it is not only about having the information, but about interpreting it and knowing how to connect it with the preferences of the clients to create identification with the brand. There are other cases where this technology is used as in the creation of inventories to avoid unnecessary supply and wasted space. In the field of finance it reduces risks and something important is its use in the selection of personnel, optimizing the hiring process seeking loyalty in future employees.

Today I want to tell you a practical example of how in Homie.mx we are making use of data science to turn an old-fashioned process that took days or weeks into a system that takes a few minutes. Yes, they read well, from days to minutes!

When renting an apartment most of the time, an analysis of the profile that is being applied to be the tenant of your property is made. It can be a basic form provided by the real estate agency literally on paper or a “background check”, supposedly more elaborate. We provide our tenants with a simple digital format to apply where they provide us in a few minutes with information that we process through a predictive model based on clusters. I know, all this sounds very complex but it is not.

The model we develop includes variables such as age, nationality, occupation, marital status, academic background, tastes, socioeconomic background and credit history of the sample of people being analyzed. Once we have our information points, we identify similar characteristics among the profiles and create our groups, the clusters mentioned a couple of paragraphs above. In this way we can be more assertive even when we do not have all the information about a new prospect, for example maybe you are a foreigner and do not have a credit history in Mexico, but because of your socioeconomic and demographic data, thanks to the model we developed, we can predict that group (cluster) of prospects you look like and what are the habits of that group.

This multidisciplinary process is based on national statistical data where we can know beforehand various aspects such as income, possible monthly expenses and financial habits. With all this information, we help to measure the risk of default of each potential tenant and helps us understand how to minimize or mitigate a negative action by customers.

The most surprising thing is how assertive we have been when selecting tenants, it is incredible but Homie.mx tenants have a delinquency rate below 1% and the few delays we have had since the start of operations do not exceed 5 days. This gives confidence to the owners and breaks the paradigm that technology-based processes are reliable and can replace the old methods and traditional habits of any sector.

The fact of knowing that data science advances and revolutionizes all types of industries is a great area of opportunity to seek improvement in processes and above all a reduction in risks. In addition to knowing exactly what your audience is looking for or hoping to find, data science helps us predict scenarios and gives us a solution to avoid falling into old mistakes or speculation.

Data Science is not only an accumulation of information, the interesting is the interpretation and application of it, in addition to letting you know your audience offers advantages such as anticipate the needs of your customers or in our case have 100% of success in the choice of our customers, therefore we do not fail the owners and the tenants complete a rental process in 24 hours, all thanks to the science of data.

Without a doubt, Data Science is one of the factors that will allow us to revolutionize industries, every day we will see more examples in our daily life of this. I think William Gibson, well-known writer of the 70s, describes well the scope of the future in today’s world with his phrase “The future is here, it’s just not widely distributed yet”.

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